MUNICIPAL CONSOLIDATION LOWERS STAKES FOR BOTH

C O N F I D E N T I A L TAIPEI 000781

SENSITIVE
SIPDIS

E.O. 12958: DECL: 06/29/2019
TAGS: PGOV PINR TW
SUBJECT: MUNICIPAL CONSOLIDATION LOWERS STAKES FOR BOTH
PARTIES IN DECEMBER LOCAL ELECTIONS

Classified By: AIT Deputy Director Robert Wang for reasons: 1.4 (b/d)


1. (C) Summary. On June 23, a Ministry of Interior panel
endorsed proposals to elevate Taipei County to a special
municipality, to upgrade and merge Taichung City and County
into a special municipality, and to merge Kaohsiung County
into Kaohsiung City, which is already a special municipality.
The decisions, which will allow these local governments to
tap additional central government resources, were expected.
The move also puts off for one year the local elections in
several jurisdictions, reducing the stakes for both the
opposition DPP and the ruling KMT in the upcoming city and
county elections on December 5. End Summary.


2. (U) As expected, an ad hoc Ministry of Interior panel
announced June 23 that it had approved Taipei County's
application to be elevated to the status of a "special
municipality." The panel also announced it had approved the
merger and elevation of Taichung City and County and the
merger of Kaohsiung County into Kaohsiung City, which is
already a special municipality. The panel rejected separate
upgrade applications by Taoyuan and Changhua Counties and the
merger/upgrade request of Yunlin and Chiayi Counties.
Taiwan's Executive Yuan must now approve the panel's
decisions before the elevations and mergers can be
implemented. While the panel made decisions on most
applications, it failed to reach a unanimous decision on the
merger/upgrade request of Tainan City and County, and
referred it to the Executive Yuan for a decision.


3. (SBU) Local political leaders were able to set aside
partisan differences because the central government allocates
significantly more funds to "special municipalities" than to
ordinary cities and counties. However, the administrative
change will eliminate a significant number of local elected
positions. Note: Currently, Taiwan has two special
municipalities: Taipei and Kaohsiung Cities. After the
elevations and mergers take effect and if Tainan's
application is not approved, Taiwan will have 4 special
municipalities, 4 cities, and 15 counties, including two
(Kinmen and Lienchiang) that technically belong to Fujian
rather than Taiwan. For Taipei, the government's long-term
plan is to merge Taipei City, Taipei County (which will be
renamed New Taipei City after its elevation) and Keelung City
into a single municipality. End Note.


4. (C) Beyond fiscal implications, this administrative
re-jiggering will affect the electoral strategies of Taiwan's
main political parties. The December 5 elections had been
viewed as an early mid-term test for the Ma administration
and a measure of the DPP's efforts to launch a comeback after
failing miserably in the 2008 legislative and presidential
elections. The DPP was hoping and the KMT worrying that
popular former Premier Su Tseng-chang would run for Taipei
County magistrate, a position he held from 1997-2004. Both
parties calculated Su would have a good chance of winning
Taiwan's largest jurisdiction (3.8 million residents) against
virtually any KMT candidate, especially the unpopular
incumbent magistrate Chou Hsi-wei. Su, however, has always
seemed more interested in running for the presidency than
returning to a local position he held previously.


5. (C) Despite DPP complaints that the government is playing
politics with the administrative changes, both parties
probably view the decisions on elevations and mergers with a
sigh of relief. The KMT has avoided a difficult candidate
decision and election contest in key Taipei County. For its
part, the DPP is not well prepared for a major election test
this year, owing to the corruption trial of former President
Chen Shui-bian and continued factional divisions within the
party. Taking several of Taiwan's most populous districts
off the plate will reduce the political significance and
public attention given to the upcoming local elections.
However, the mayoral elections for the four major
municipalities in December 2010, representing 9.1 million
people, about 40 percent of Taiwan's total population, will
attract considerable interest. Kaohsiung Mayor Chen Chu
(DPP) has already indicated she intends to run for
reelection, and Taipei City Mayor Hau Lung-in (KMT)
doubtless also plans to run for reelection. Both parties are
likely to field "political stars" in New Taipei City,
although Su Tseng-chang may decide to sit out the race,
preferring to focus on his presidential aspirations. In
Taichung, although Jason Hu (KMT) has already served two
terms as mayor, the two-term limit does not preclude him from
running for mayor of the new special municipality.
YOUNG